But there's a big difference between simplification, and flipping something on its head.

In the book, the dwarves mock Bilbo for being a "grocer," and for being a tad legalistic. In the film, the audience will mock the dwarves for that quality.

This, to me, reverses the dynamic of Bilbo vs. the dwarves that exists in the book.

The dwarves never mock Bilbo for being "legalistic". I don't understand where you are getting that at all. The new version of the contract is simply an extension of Thorin's character; he is described as being extremely long-winded and pompous, and willing to speak on endlessly if he gets an opportunity. These qualities are represented in the contract, here. It is in no way turning the characterizations upside down.